“The proposed transaction is the product of a flawed sales process and is being consummated at an unfair price,” Ubaney said in his complaint, arguing that the deal–which will pay common shareholders $5.70 per share–did not maximize Palm’s value as well as it should have. An understandable point given that preferred shareholder Elevation Partners stands to recoup $8.50 a share on its initial $325 million investment, thanks to the liquidation preference it was able to negotiate.

Now Palm (PALM) has persuaded Ubaney to drop his claim, although just how isn’t clear. Terms of the settlement weren’t disclosed, and in its SEC filing, Palm says they “will not affect the amount of the merger consideration that Palm stockholders are entitled to receive in the merger.”

So one shareholder suit down. But still a few more to go. Says Palm: “A number of substantively similar putative stockholder class action suits also remain pending in the Superior Court of California in Santa Clara County.”

The Santa Clara County district attorney’s office is investigating gadget site Gizmodo’s purchase of the device, according to a report by News.com. Sources tell News.com that the effort is being headed up by the office’s Rapid Enforcement Allied Computer Team.

According to those sources, investigators are looking at “whether sufficient evidence exists to file criminal charges,” though they did not say who is being targeted–the person who found Apple’s (AAPL) iPhone protoype or Gizmodo, which purchased the device for $5,000 and revealed it to the world, perhaps in violation of California’s Uniform Trade Secrets Act.

Gawker Media, which owns Gizmodo, says it hasn’t yet been contacted by law enforcement.

Some 52,000 households in Santa Clara County were expected to be without phone and Internet until at least late Thursday night, according to a county spokesman. Other counties experienced outages as well. Cellphones were also impacted since the cables that were cut handled all voice and data traffic in and out of the area.

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Well, here’s what we know so far. California’s overall employment rate hit 8.2 percent in October, up from 7.7 percent in September, to the highest level since September 1994. Now, that’s not just the tech industry hurting: the construction industry in the state has lost 69,500 jobs this year, for instance. In Santa Clara County, the jobless rate stands at 6.9 percent; San Francisco is lower, at 6 percent, while San Matero County, home to venture capital’s Sand Hill Road, is down at 5.4 percent. Slightly worse off are the East Bay counties of Alameda, at 7.1 percent, and Contra Costa, at 7 percent. The national jobless rate stood at 6.5 percent in October.

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